Snapdeal has garnered a whopping $ 500 million investment led by Alibaba Group, Foxconn and SoftBank. Existing investors Softbank, Temasek Holdings and BlackRock Inc. also participated in the round that values the company at $4.7 billion.
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While Snapdeal did not comment on how the cash will be spent, most ecommerce players in India are burning cash to grab a higher market share.
The move is a vote of confidence from three of the world’s biggest technology companies in Snapdeal, which in October got a $627 million investment from SoftBank, also an early backer of Alibaba.
EBay said in a statement it has sold a portion of its stake and would focus on boosting its own business in the country.
The Snapdeal stake sold by eBay was purchased by the Foxconn unit and other investors, a person familiar with the deal told Reuters on Tuesday. This sale will enable us to earn a strong return on our invested capital and strategically redeploy it into other areas of our business.
Scott Schenkel, senior vice president and chief financial officer at eBay said: “India is an important market for eBay, and part of our fast-growing APAC region”. And crucially, eBay will retain a “significant portion” of its original investment, meaning that it will continue to benefit from Snapdeal’s growth across the country.
The company has more than 150,000 sellers and about 15 million-plus products across 500 plus categories listed on its platform.
He added, with global leaders like Alibaba, Foxconn, and SoftBank supporting the company, its efforts towards building India’s most impactful digital commerce ecosystem will be propelled further, enabling it to contribute towards creating a Digital India.
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Snapdeal currently delivers goods to over 5000 cities and towns in India.
